At the sight of an American soldier the mothers, holding on to their restless children, rose up as one. When was the rubbish and raw sewage going to be cleared off the streets, they wanted to know. The germs and the stench were posing a health hazard to their sons and daughters, they said.

After a sharp drop in violence in Baghdad, attention is turning to the wretched state of the city's basic services and its threat to public health. Embedded with US army patrols in the south of the city, the Guardian has witnessed streets turned into foetid green cesspools and open sewers, where children kick footballs and ride bikes. Stray dogs roam on swaths of ground piled high with discarded household waste, concrete debris, burnt-out cars and other decaying rubbish.

Captain Francisco Lopez, of the 2nd Stryker Cavalry Regiment, assured the mothers sitting in a dentist's waiting room: "We understand the problem. There are contractors to pick up the trash, clean up the sewage water, fix the electricity. To provide all these services, we have to ensure it is secure for all the contractors. When security is established, it allows the contractors to clean up the streets."

Ongoing security fears have prompted black humour about the world's worst jobs, which surely include "Baghdad sewage collector". When the violence was at its peak few contractors were willing to take on the task for fear of roadside bombs and sniper fire. The situation worsened because, due to its warm climate, Baghdad pipes are not buried deep and are easily broken by improvised explosive devices intended for military targets.

Capt Lopez said later: "The pipes are breaking left and right and it is a public health hazard. It is our colonel's number-one priority. Along with collecting sewage, you have to turn off some of the pipes. There's a lot of work going on and it is more secure now, but it will take time to fix all the damage. This has priority but it's pretty nasty."

The Iraqi government has warned that some residents in poor neighbourhoods drink water contaminated with sewage, exposing themselves to gastroenteritis, typhoid fever, cholera, diarrhoea and hepatitis. The US military has expressed disappointment at the government's failure to capitalise on the relative lull in violence by improving basic living conditions. Some American soldiers mutter privately about the need for Iraqis to find civic pride and "pick up their own trash".

At a squadron meeting in Baghdad last week an officer was told by his commander: "You've got to clean up this shit." The officer later told the Guardian that the sewage contractor in Dora, a notoriously violent district, had been slow to start work and risked losing its fee unless it got on with the job. Half the sewage pumps in the district are still broken, a problem which could be exacerbated by cold winter nights. It has also been claimed that some Baghdad companies contracted by the US for reconstruction work are giving a percentage of their takings to insurgents who have otherwise threatened to kill them.

Northern Iraq has already been hit by cholera this autumn, although the government claims it has now managed to limit the spread of the water-borne disease. But aid agencies warn that lack of clean drinking water and poor sewage systems could lead to a fresh outbreak. About 70% of Iraqis do not have access to clean water.

The lack of medical provision remains a grave concern. Hussein al-Hamiry, 46, a teacher from al-Hadar in Baghdad, said: "It's been a whole year since we had electricity. [Summer] temperatures reach 55C (131F) and, without air conditioning, that causes children to be sick and diseased with no medical services at all. A mortar round landed here and a member of my family lay on the ground, bleeding to death, because there was no doctor to help."

The government has said it hopes to expand the availability of drinking water and sewage services in coming years, in addition to paving roads, and building bypasses and bridges. Barham Salih, the deputy prime minister, said: "Our message to the world is that Iraq is in need of your continuous support so Baghdad will be the capital of a secure Iraq."